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Apparently Google has gotten rid of thousands of temporary workers according to the Associated Press based on documents filed to the SEC. I can’t say this is terribly surprising based on layoffs at my own employer and elsewhere in the tech industry.

As mentioned in my previous post, I just bought a new Dell desktop. One of the things I immediately noticed was the behavior outlined in this blog post about Google and Dell “hijacking” browser address bar type-ins to go to advertising-heavy pages.

Don’t get me wrong, I am an advocate of advertising on the web, but what I didn’t like was that I in the few minutes I spent trying to investigate this on my own machine I didn’t figure out how to turn it off. I primarily use Firefox anyway so I figured I wouldn’t have to deal with it anyway. However, I’ve noticed that even though Firefox thinks it’s my default browser (as I selected it should be) various other applications on my computer keep launching IE7 when they launch web pages.

While I think it’s okay for Google and Dell to work together on providing search results with some advertising, what they’re doing here is pretty offensive with the page above the fold being entirely ads and the difficulty of removing the behavior from your system.

There are lots of bloggers talking about Google’s launch of their Pay-Per-Action (beta) program which is really just adding CPA ad units to Adsense with a name to not associate it with CPA directly.

My first reaction is that people are jumping to lots of conclusions about what this program means, what it will do, who it’s competing with, and what it will mean for advertisers, publishers, and arbitrageurs.

I was going to refrain from making a post about this until I had really digested it more and potentially even tried out the beta program if accepted, but since Pete Caputa somehow confused me for being smart, I’ll at least post a few thoughts.

CPA is harder on publishers
There’s no arguing that with CPA ads, publishers take all the risk. This is good for advertisers, and generally it’s harder on publishers. However, GOOD publishers who understand CPA, persuasion architecture, delivering users who will convert, and funneling your site correctly, can actually make more money from CPA then they would from CPC or even a flat CPM. Publishers who don’t understand these things and are used the normal Adsense model will most likely struggle to generate more money with this ad type because of the difference in how you monetize a user.

CPA is a different ball game
There is an assumption that this will be a major challenge to affiliate networks like Commission Junction and Linkshare. Maybe it will be, but I can say that these networks provide a lot of value because they help advertisers create the right kinds of creatives and really optimize CPA. How much advice is Google going to really give on setting everything up? How much human touch will they provide to this process? With Google’s program, if the advertiser’s landing page sucks will Google consult to help them improve it? Sure, they provide access to their Website Optimizer Tool, but those who have tried multi-variate testing know that isn’t just a cut and dry automated process like Google is trying to make all of this.

Will this hurt lead generation or affiliate arbitrage?
I’m not sure I care. Businesses need to provide value, and if Google just made it more efficient so that it’s harder to arbitrage stuff, so be it. I’m not necessarily against arbitrage, but you can’t expect companies to leave things inefficient. Arbitrageurs are always looking for an edge, and most likely they’ll still find one somehow and somewhere.

Overall thoughts
Until we see the program in action, see what advertisers succeed with it, and how publishers can work with it and what types of results they get it’s hard to predict what will happen. The general assumption is that since Google has dominated with Adwords/Adsense/CPC they will dominate CPA by adding it to the mix. Well, Google HAS NOT dominated CPM and display advertising when they added it to Adwords/Adsense. I don’t think it’s a given by any means that this will work as well, however I do give it a better shot. I think the CPA direct marketing advertisers are closer to being the same group that does well with CPC now, while flat CPM and display advertising tend to be a different type of advertiser. It will be interesting to watch.

While doing some research, an astute coworker of mine noticed that the Google Enterprise Solutions page has links to their partners’ websites who are part of their Enterprise program. What’s interesting about this is that the page has a Google PageRank of 7/10, and to get listed on that page you have to pay Google $10,000 per year to be part of their program.

Before you claim I’m overreacting, let me state my case with some evidence:

1. The only way to get a link on this page is to pay Google $10,000 per year.

2. Google is against the inclusion of paid links in their Pagerank algorithm that helps determine search results. Here is a quote from their Corporate Technology page:

PageRank also considers the importance of each page that casts a vote, as votes from some pages are considered to have greater value, thus giving the linked page greater value. Important pages receive a higher PageRank and appear at the top of the search results. Google’s technology uses the collective intelligence of the web to determine a page’s importance. There is no human involvement or manipulation of results, which is why users have come to trust Google as a source of objective information untainted by paid placement.

3. Google’s most prominent blogger Matt Cutts has spoken out against paid links and recommended use of the rel=”NOFOLLOW” attribute.

4. Google could add the “rel=NOFOLLOW” attribute to the links on that page in order to not pass Pagerank credit from the page to the partner websites. According to the Wikipedia page on Pagerank:

In early 2005, Google implemented a new value, “nofollow”, for the rel attribute of HTML link and anchor elements, so that website builders and bloggers can make links that Google will not consider for the purposes of PageRank — they are links that no longer constitute a “vote” in the PageRank system.

Why isn’t Google putting the rel=”NOFOLLOW” on these links?

As a side note, the links to Google in this blog post have the rel=”NOFOLLOW” on them because I don’t want to be passing on PageRank to that Enterprise Partners page.

5. Google could also just not rank the Enterprise Partners page with PageRank as they appeared to have done with their Adsense Case Studies page. You’ll see it is not ranked, and the page has existed for a long time meaning Google has intentionally chosen not to rankthis page. They also don’t even link to the publisher websites or in the case studies themselves for the most part, they just write out the text like ApartmentRatings.com with no link. However, I did find that a couple of the older case studies like the Weblogs Inc. one that do have links out. Of course, there is no page rank on the case study giving them no benefit.

Why do the partners paying $10,000 seem to get links with a high PageRank?

6. Google IS including the Enterprise partners page in their index which leads me to believe they are counting the Pagerank on the page. See the #1 result on the search query for “google earth specialist”.

The counter argument to my evidence is that the partners really aren’t paying for the link, but that the $10,000 fee is for the overall Enterprise partner program. True, but the ONLY way to get listed on the Enterprise Partners page is to pay Google $10,000 per year, which means the ONLY way to get a link on that page is to PAY FOR IT!

From what I can tell Google is not taking the steps to exclude the power of those links in their algorithm. Those are not just “editorial votes” as a natural link is supposed to be in the algorithm, those links are there because money exchanged hands.

I actually agree with Google’s stance on not including paid links in their algorithm, but there’s really three options here:

1. Google is being sloppy and not intending to be counting paid links, but they are.

2. Google is taking money for links and looking the other way.

3. I’m missing something, please let me know if I am.

In closing, I see that Google acquisition YouTube.com has now been added to the Google Products page that happens to be a PR9 page. If they’re charging $10,000 for a PR7 link, let’s hope YouTube didn’t have to give back too much of that $1.65 billion to be listed on this page!

UPDATE:
Apparently Google had a different but somewhat similar problem with using NOFOLLOW on most of the links on Google Video except for the links to their advertisers. Matt Cutts responded in the comments that it was a mistake and would be fixed as fast as possible. Good to see them fix and own up to the mistake. But the question remains, is the case I mention above a mistake?

UPDATE Part 2:
The page in question no longer carries a Pagerank. I’m guessing from the comments Matt Cutts had this changed. Thanks for taking action Matt, as I believe Google should be careful with links that may be considered “questionable” on whether or not they are pure natural links.